"Most Mergers Dont Work". Your datapoint- an article on a GOVERNMENT AGENCY? You have got to be kidding me.

Farhad, your obvious lack of a clear understanding of how corporate America operates should cause you to excuse yourself from covering this story. Just stop, OK?

You're not really allowed to threaten to artificially depress the market value of a company in order to buy it cheaply as an extortion/negotiating tool. We tend to call that oh, I dunno, RACKETEERING. The implication, is as I'm sure you see, a threat that NO ONE else would be allowed to bid either.

I've always had my doubts about Sweating Steve's sanity. He is truly an unhinged nut who's role has always been defined by his close personal relationship with Gates and his own schizoid maniacal personality. Maybe Napoleonic tirades work in-house but the law tends to frown on them.

Farhad,

I'm not going to argue that you don't have a good understanding of technological products. And I'm not going to argue with you about whether or not MS has produced good products, or rather gained dominance from various other means, ie market dominance.

BUT do you think that MSoft execs don't understand the business? There are multiple reasons why they might want Yahoo. To get their technology. Redirect their highly hit web sites to MS content. Skilled employees; even if a hostile takeover causes many director level employees to leave they'd still keep a ton of highly educated employees that wont bother leaving. And I'm sure there's lots of other reasons why MS would want to do this.

Now we know you hate M$oft and ... that's OK. But don't think that MS are business fools, and don't think that Google isn't scared about any change in the environment they currently dominate.

Its glaringly obvious to everyone that MS has lost the search engine game, and there's nothing they can do about it for the time being.

Now, like a school yard bully who's lost a fight, Microsoft has run off looking for someone else to battle in an effort to heal their wounded pride. This merger proposal is not about making business sense, but rather about Microsoft management showing the business world that they're not impotent.

...what you're commenting on before you take that leap. (Some advice for you.)

For instance, if you'd read the story at the link, you would have seen I was not talking about government mergers. From the article:

In the business world, most mergers don't work, Nanda says [Nanda is Ashish Nanda, an associate professor at Harvard Business School and an expert on corporate mergers]. Many fail to produce the sort of spectacular results that their promoters promised at the time of the merger, and the merged entity is often less successful than were the individual parts brought together. Inflated expectations, "culture clashes," and the inevitable shuffling of positions in the new firm can cause problems in the merged firm several years after the integration, he says.

More on merger success rates:

http://www.csc.com/cscworld/072006/fa/fa004.shtml ("Most mergers fail. Failure means that the new organization is worth less than its pre-merger components.")

This is like that time you said I advocated the elimination of copyright for anything digital. I didn't say that, and you might have known that had you read what I've written on the subject. Reading works, I promise.

Converting Yahoo to an all-Microsoft infrastructure would add significant distractions and costs at a time when Microsoft really needs to pay attention to their core products. Doing this in the unfavorable environment created by a hostile takeover would just make it worse.

I can't see what Microsoft hopes to gain from this that would be worth the hassle.

And that is, the 'customer' isn't locked into a vendor on the client end of the business. This is why every foray into online businesses for Redmond ends poorly for them. So if they Redmonize the Yahoo brand, it will only hurt everyone. No one wants "Microsoft Update for Yahoo". No one wants an online business model that relies on WGA checking to see if you've licensed the right products from Microsoft first.

No doubt MS's foray into the web has been a failure. However, why do you assume they're going to Redmonize the Yahoo brand. Assuming they're not total idiots why wouldn't they Yahooize MS's web presence? Just because they're evil doesn't mean they wont learn from a mistake.

Also, getting a customer locked into a vendor is exactly what Google has done. Google had a great breakthrough with search engine technology 10 years ago but now all the search engines use pretty much the same algorithms to search. Yet google retains the market share? Why, because people are used to Google, they trust it. And hence Google has them locked in. Why do you think Google then gave away a Gig of memory on email (which everyone else then promptly did)? Because email is the best way to lock in a customer online. These customers may not be locked into a client application, but they are essentially locked into an online application.

Mike

PS On a side note I find it particularly annoying when people refer to Microsoft as Redmond. Redmond was and is a city on it's own apart from MS. Not to mentioned that MS, along with Yahoo, Google, and most businesses are scattered across the world. However, what really annoys me is the geographical snobbishness that we often read from ... the Bay Area. I mean, you don't hear other parts of the world that do technology refer to Old Man Silicon Valley or other such nonsense.

MS's biggest exchange competitor.... owned by Yahoo....

Not good...

Google doesn't lock you in. Locking you in would mean requiring something like Passport to use it. Or at the least that bothersome idiot 'registration'. Google sells its service not its math. No one gets to see the math under the covers. For Google the user experience is the same whatever you use to come at it with. In the Microsoft world, everything works a little differently or only through Microsoft products. You see a little of this with Apple prods such as iTunes which just don't run as well in Windows as they do natively and that whole AAC encoding issue that crops up. None the less Apple is 1/10th the size of Microsoft.

BTW Microsoft went to Redmond because Bill Gates wanted to live near his parents. No other reason. Microsoft's 1st corporate HQ was in New Mexico